Thoughts on India

We are expecting the formal announcement of the Lok Sabha elections to be posted within the next 24 hours heralding the formal start of the election campaign.

In practice, nothing will change since rhetoric has been ratcheting up since the beginning of the year. Ministers traditionally will refrain from any policy announcements with civil servants endeavouring to keep the wheels of central government turning.

I am more than ever convinced that this election could see India evidencing signs of increased political maturity. The language of aspiration is drowning out the established mantra of entitlement and the use of social media across classes and divides is striking.

A week ago I returned from 3 weeks in India during which period, the Aam Aadmi Party conspired to throw another cat amongst the pigeons by spectacularly resigning from the State Government role in Delhi. One might argue that the end of a 48 day tenure was contrived and potentially counter-productive, the immediate effect was electric.

Latterly, the BJP has ramped up its pro-business rhetoric. Just last week he made three statements of potential import:-
• Retrospective tax legislation: Mr Jaswant Singh, the finance minister in the last BJP led Government announced that they may change a retroactive tax law passed two years ago because it deters foreign investment. The party will seek to hold talks with companies to resolve tax disputes, including those of Vodafone and Cairn.
• FDI in retail: Mr Narendra Modi last week somewhat elliptically asked the trading community not to run away from global challenges but adapt itself to modern practices like tying up with bigger stores and online trading.

• Goods and Sales Tax (GST): Again Mr Modi clearly stated that the BJP favoured the implementation of the GST, adding that IT connectivity is a prerequisite to proper implementation of GST.

This pro-business BJP assault via the airwaves contrasted sharply with the slow-motion train wreck which was Rahul Gandhi’s recent 90 minute interview on Time Now and the lack of definition around “governance” statements by Mr Arvind Kejriwal of the AAP. But these are early days in what will be a bruising 2 month campaign.

Nevertheless, the upcoming elections are of course a hot topic in India and extremely relevant for international business.

We will be examining the broader implications of the Indian election on UK businesses in more detail regularly during the campaign. Our first webinar was recorded last week with Jan Zalewski from Control Risks and myself participating. In it we discuss the possible outcomes and what they might mean for the investment, business and tax environment. You can listen here.

Elsewhere

This month the latest issue of UKIBC Business Exchange has been landing on desks. We continue our theme of focusing on India’s business friendly states. Karnataka, the capital of which is Bangalore, the state is famous as a centre for engineering, innovation and IT.

We have a great line up of articles offering insights into the State; a highlight being an interview with the prominent Bangalore-based industrialist, and member of the UKIBC Advisory Council, Kiran Mazumdar-Shaw. I hope you’ve had a chance to read some of the other inspirational UK-India success stories, as well as insightful and useful advice about entering or expanding in the Indian market. If not you can read the magazine online here.

As always if you have any feedback about the content or the magazine in general place get in touch.

We also had the pleasure of hosting Mr S Ramadorai in London during February. Mr Ramadorai has been at the forefront of Indian business and developments within India’s digital and technology sector over the last few decades. He gave an insightful view of India’s current economic and political situation, his time as Chief Executive at TCS, as well as, an overview of his recent work as the Chief Advisor to the India Prime Minister on Skills Development. If you couldn’t make it to the event, you can read a summary here.

Looking forward we have both our upcoming cross sector delegation to Delhi, Gurgaon and Bangalore, and an exclusive networking event with Lord Karan Bilimoria CBE, DL in March. Lord Bilimoria is the founder of Cobra Beer, Chairman of the Cobra Beer Partnership Limited and of Molson Coors Cobra India. He is also the founding Chair of UKIBC and is exceptionally active in both UK-India business and politics. I expect this will be a very insightful evening. You find out more, including details of how to register for the event here.

UKIBC in India

The UKIBC centre in Gurgaon goes from strength to strength with more residents, events, delegations and language and professional training. To find out more details you can access directly the website here.

I have just returned to India. Last week, we signed a lease on some 13,500 sq ft of office space in Dairy Circle, Koramangala, Bangalore. Our Puja will take place 14th March and we are aiming to welcome first clients via a “soft” launch at the end of April.

We are really excited by this, not least as Koramangala was summarised by Bangalore’s Financial Times 2 weeks ago as “the new start-up hub”…” being in the heart of a city hosting big-shot entrepreneurs gives the positive vibe to this place”…….

More on these developments in due course.